According to Gartner, the ERP implementation failure rate exceeds 75%. Global consultancy McKinsey estimates that over 70% of all digital transformations fail due to ERP problems.
In stark contrast, major construction engineering projects seldom fail such that it is headline news when a major engineering project fails.
There is a huge difference!
It is interesting to note that the above failure statistic covers ALL the significant software systems on the market and ALL the significant ERP implementers, including the BIG Brands! ERP failure is at epidemic levels, although seldom discussed in public by the industry.
Words of an Expert:
Dr. James A. Robertson, the ERP Doctor, as a Professional Engineer, has approached ERP implementation from the perspective of Engineering Reliability. He has spoken widely about this topic, with his flagship presentation being “WHY your ERP is NOT Delivering and HOW to FIX it!” He has also spoken at numerous conferences.
As a consequence, he has been approached by numerous clients who faced ERP problems and sub-optimal ERP project outcomes. This has led to a catalogue of the seven “Critical Factors causing ERP Implementation Failure” and the seven “Critical Factors for ERP Implementation Success.” These factors radically differ from the conventional wisdom and the methods generally employed by the implementers responsible for the 70% failure rate.
We define success as a system implementation that results in the organisation being more competitive, profitable, and efficient — success at a tangible level that is evident to the shareholders in a cash return on investment. Failure is, per definition, anything that does not achieve these objectives. Failure is best determined via a private, off-the-record interview with the Chief Executive – most C-suite executives are reluctant to admit failure in public and on-the-record.
Interestingly, the industry continues to seek to get better at its way of doing things, which is responsible for the high failure rate caused by avoidable ERP problems.
The ERP Doctor is available to assist your organisation in understanding why your ERP project has failed to meet expectations or failed outright and to turn things around. Reach out for an insightful consult.